As the market reacts to the S&P downgrade of the U.S. credit rating (more help from the folks who gave a AAA rating to toxic mortgage-backed securities -- thanks, guys), the entire world is holding its breath at the prospect of a double dip.
So far, the tech sector has escaped the worst privations of the Great Recession. It's the polar opposite of the dot-com bust a decade ago; instead of leading the plunge, tech has been doing considerably better than the economy as a whole.
First-quarter growth for the U.S. economy overall was an abysmal 1.8 percent. But in July, IDC raised its 2011 U.S. outlook for IT spending to a 7 percent increase over 2010 -- with 37.5 percent growth expected in worldwide smartphone sales. And while U.S. unemployment refuses to dip below 9 percent, unemployment in the technology sector remains well below 5 percent.
Here's another interesting metric: PricewaterhouseCoopers reports that Q2 2011 venture capital investments returned to a level not seen since Q2 2008. The leading sector was software, with 254 deals amounting to $1.5 billion.
Of course, you can also find clouds on the horizon. The CompTIA IT Industry Business Confidence Index posted in July fell two points due to macroeconomic concerns. "An element of fatigue has set in with regard to the overall economy, and people are less confident about the future," said Tim Herbert, vice president of research for CompTIA. "Everyone wants to be optimistic, but the economy continues to tread water, which affects forward-looking expectations."
Then there's the recent Cisco layoff of 6,500 workers, although most analysts feel this was due to strategic missteps rather than a reflection of the overall tech economy. Same, in spades, for the RIM layoffs.